Frasers’ serviced apartments goal: Grow to 8,500 by 2010

Frasers’ serviced apartments goal: Grow to 8,500 by 2010


DRIVEN by rising corporate demand, Frasers Hospitality (Frasers) expects to grow its brand of serviced apartments to 8,500 by 2010. This will involve adding 5,000 apartments under the Frasers brand in the next two years.



China, India and Vietnam are three key areas of expansion for the hospitality arm of Frasers Centrepoint, a wholly owned subsidiary of Fraser & Neave. At least 80 per cent of the 5,000 serviced apartments will come under fee-based management, said its CEO Choe Peng Sum. Frasers will acquire the remainder with balance sheet funding.


‘We have been very careful about over-leveraging and over-borrowing,’ said Mr Choe. Frasers currently has a 50:50 debt-equity structure, but hopes to reduce the debt component to reach 40:60 or lower going forward.


Frasers is also looking at more collaborations with private equity funds to acquire serviced apartments.


‘For serviced residences, we’ve seen a lot of pent-up demand,’ said Mr Choe. According to him, multinational corporations have been sending teams overseas to set up new operations, and serviced apartments are aptly positioned to meet expatriates’ extended-accommodation needs.


Yet, the number of serviced residences in major cities such as London and Tokyo add up to barely 10 per cent of total hotel inventory, he noted. On room rates, Mr Choe said: ‘Singapore itself, we have seen year-on-year growth rates of about 26 per cent.’


Occupancy rates are also crossing 90 per cent.


With the large growth potential, Mr Choe shared that Frasers is looking at creating a separate brand of serviced residences to cater to a more dynamic group of corporate guests, or ‘road warriors’.


Hiccups in some economies may create more chances for expansion.


The property market in North America has softened, said Mr Choe, and Frasers is sourcing for deals in New York. In Vietnam, falling property prices also generate investment opportunities. As to whether Frasers will set up a Reit for its properties, Mr Choe said that ‘we are waiting for the right time’.


The US$135 million Fraser Suites CBD in Beijing has opened for operations.


Source: Straits Times


Frasers looking to expand in China, India and Vietnam

Frasers looking to expand in China, India and Vietnam 

Hospitality arm of F&N aims to add 5,000 serviced units over next two years


FRASERS Hospitality, undaunted by the uncertain global economic outlook, is pursuing an aggressive expansion strategy in China, India, Vietnam and other markets.

The hospitality arm of Singapore-listed conglomerate Fraser & Neave is a ‘contrarian’ that aims to add about 5,000 serviced apartments over the next two years, despite fears of a global economic slowdown, said its chief executive Choe Peng Sum.


He sees ‘a lot of pent-up demand’ in cities such as Singapore, London and Sydney – where its residences have enjoyed occupancy rates of more than 90 per cent.


It is also the ‘right time now to get into China’ while growth opportunities are still bright in Vietnam and India, Mr Choe told a media conference yesterday to mark Frasers’ 10th anniversary, as well as to share its expansion plans.


In Singapore, where Frasers already operates two high-end serviced residences, it is planning a third property, but details will be released later, he said.


He added that Frasers has seen a robust 26 per cent rise in average room rates to about $400 per night for certain units in Singapore.


Farther afield, Frasers is also planning to plant its brand in places such as Edinburgh, Bahrain and Perth.


Noting that ‘growth in Asia and Europe (for extended-stay accommodation) is just starting to take off’, Mr Choe said Frasers expects to expand its portfolio to 8,478 units by 2010.


It will focus on China, India and Vietnam, which have strong long-term growth momentum.


Frasers is targeting new property launches in cities where demand for serviced apartments has been driven up by expatriates working for multinational companies that set up shop in these countries.


In China, where Frasers already has 12 properties in key cities such as Beijing and Shanghai under its brand, the company is looking to grow in other cities such as Chengdu, Nanjing and Tianjin.


As for Vietnam, while skyrocketing inflation poses challenges for the hospitality industry, land prices are now becoming ‘more reasonable’ as land owners are more realistic in pricing. This offers opportunities for Frasers to expand there, Mr Choe added.


India is another key growth market for Frasers, which has seven properties scheduled to be launched there over the next three years.


Frasers is also in talks to set up private equity funds to invest in China, India and South-east Asia.


Mr Choe added that plans to inject some of Frasers’ properties into a real estate investment trust are still in the pipeline, but it depends on the ‘right timing’.



Frasers Hospitality chief executive Choe Peng Sum says the company expects to expand its portfolio to 8,478 units by 2010. Besides China, India and Vietnam, it is also planning to plant its brand in places such as Edinburgh, Bahrain and Perth.




Mr Choe says plans to inject some of Frasers’ properties into a real estate investment trust are still in the pipeline, but it depends on the ‘right timing’.


Source: Straits Times

Frasers Hospitality to its grow presence in China, India and Vietnam

Frasers Hospitality to its grow presence in China, India and Vietnam


SINGAPORE : Frasers Hospitality – the property arm of mainboard-listed Fraser & Neave – is planning to grow its presence in the emerging markets of China, India and Vietnam.


Revealing this at a news briefing on Thursday, Frasers said it plans to add about 5,000 serviced apartment units to its portfolio over the next two years. It is scheduled to open 10 new properties this year, and another 25 over 2009 and 2010.


Frasers believes there is room for growth in the serviced apartments sector in China, India and Vietnam, and is pumping in US$135 million for a prime property in the Beijing’s central business district.


That will be part of the 5,000 units that Frasers is planning to add to its portfolio. About 80 per cent will be held under fee-based management contracts.


Frasers has already opened two developments in Tokyo and Hanoi. Eight more will be launched within the next eight months, mainly in China, including a soft opening for its first apartment units in Hong Kong. The target is to open 25 properties within the next two years.


Serviced residences in most Asian countries account for about 10 per cent of the hotel inventory. Frasers said it sees more upside potential in this, especially with increased demand from multi-national corporations.


Choe Peng Sum, CEO of Frasers Hospitality, said: “I think the outlook for serviced apartments is (great). A lot of companies, instead of sending long-term expatriates there for 3-4 years, they are actually bringing project groups over for maybe 1-8 months, where they’ll start up the project and then fly back. That’s exactly where our market is, and a lot of our properties are seeing 80-90 per cent occupancy.”


Frasers is also looking at other opportunities in the Middle East, particularly in Abu Dhabi, Qatar, Oman and Kuwait, on top of recently announced Dubai and Bahrain.


Frasers currently has about 3,500 apartments worldwide, and it expects to have 8,478 apartments by 2010. – CNA /ls


Source: Channel NewsAsia

Frasers Hospitality planning global expansion

Frasers Hospitality planning global expansion


Frasers Hospitality is planning an aggressive expansion globally, with 5,000 serviced apartment units slated for China, India and Vietnam by 2010.


The property arm of mainboard-listed Fraser & Neave then plans to expand its presence in the Middle East, Australia and Europe, and maybe even enter the US.


Among the service apartments that will be launched by 2010, one is a 23-storey prime properrt in Beijing, in which Frasers has invested 135 million US dollars.


But most of the company’s other upcoming serviced apartments will be owned by other parties, and Fraser will only operate them on fee-based management contracts.


In fact Frasers will own only 20 percent of the upcoming 5,000 rooms to be launched in the next 3 years.


Chief Executive Choe Peng Sum said the expansion will help to meet the pent up demand for serviced residences around the world, and especially in cities such as China and India, which are seeing tremendous economic growth.


He said the demand is being created by the fact that many firms are now cutting back on long-term expatriate contracts, and instead sending project teams to stay overseas for just a year or less.


“If you stay for 3, 4, 5, 6, 8 months, to stay in a hotel would be a bit claustrophobic after a while. Yet if you’re not signing 1, 2 or 3-year leases, then you’re not in the apartment or condo market. So we fall right in the middle, where we meet the needs of the mid- to long-term segment.”


After 2010, Frasers plans to expand its presence in the Middle East, with developments slated for Abu Dhabi, Kuwait, Doha and Oman.


Mr Choe added that the company also plans to expand in Australia and Europe, including entry into cities such as Prague, Budapest, Madrid and Barcelona.


He said Frasers is even looking for possible acquisitions in New York, as the US market is now softer in the wake of the subprime and financial crisis.


Source: 938Live

Hospitality training for public at Ascott

Hospitality training for public at Ascott 

New centre to offer classes to its employees as well as others


FOR the first time, a big name in the hospitality industry is opening the doors of its training centre to the public.

The new Ascott Centre for Excellence, which is aimed at mid-career workers, will see employees of the Ascott Group studying subjects like guest interaction and risk management together with paying members of the public when classes start in October.


The centre will market its courses to small or mid-range hotels, which do not have the resources to run such programmes.


Indeed, general managers of boutique hotels which The Straits Times spoke to said the centre’s set-up helps to fill a gap in the industry, as they lack the large human resource departments or dedicated trainers found in larger hotels.


Tourism and hospitality training is among the most sought after in Singapore today, as the industry rides a boom fuelled by record arrivals. Prospects are even brighter with upcoming events such as the Formula One race and the opening of the integrated resorts.


Already, courses on subjects such as hotel management in the polytechnics are regularly oversubscribed.


The opening of the centre ties in with a push by the Government to improve continuing-education opportunities for workers here.


In February, the Ministry of Manpower unveiled its Continuing Education and Training masterplan which aims to increase the number of training places to 80,000 within the next decade.


Speaking as the guest of honour at the centre’s launch yesterday at its new Anthony Road campus, Education Minister Ng Eng Hen stressed the need for more collaboration between the public and private sectors to reach this goal.


‘Business cycles are more volatile and shorter, with greater potential to disrupt careers or make skills obsolete…The Government will do its part by providing funding and infrastructure development, but private companies know that it is in their interest to develop their own employees.’


The new centre, an expanded version of the group’s eight-year-old inhouse training institute, is the only one here that offers the Workforce Development Agency’s (WDA) full range of hospitality and accommodation service programmes.


Ascott Group’s employees will make up two-thirds of each intake of about 1,000 students. Members of the public can expect to pay fees starting from $3,000, according to WDA guidelines, although Singaporeans and permanent residents can apply for subsidies from the WDA.


Source: Straits Times

Ascott launches new hospitality centre

Ascott launches new hospitality centre


The Ascott Group today officially opened its new global hospitality training centre in Singapore called Ascott Centre for Excellence.


The centre will train Ascott’s 5,000 employees located in the Asia Pacific, Europe and the Gulf region to support its global expansion.


Besides Ascott’s proprietary programmes, the training centre is the first in Singapore to offer the Workforce Development Agency’s full range of Hotel and Accommodation Services programmes.


This full range of hospitality programmes will be opened to the Singapore public from October this year.


They range from Certificate and Advance Certificate to Diploma level.


In addition, Ascott has signed a Memorandum of Understanding with Nanyang Business School to offer management trainee programmes and internships to its Tourism & Hospitality Management students.


Ascott’s President and CEO Jennie Chua said by providing students with real work experience and learning opportunities, the centre hopes to raise awareness of hospitality as an attractive career among the younger generation.


Source: 938Live

Ascott loves blazing a trail in India

Ascott loves blazing a trail in India

The global serviced residence giant sees huge potential, with business travellers clamouring for home-like comfort and services, reports CHUANG PECK MING


WHAT the Singapore- based Ascott Group has to offer India is likened to ‘adding ciabatta and focaccia to a selection of pratas and naans to cater to different tastes and preferences’, says Gerald Lee, its deputy chief executive for operations.


‘We bring something that works in the Indian market, and up the standard and choice of accommodation offering,’ Mr Lee says.


Coming from an official of one of the world’s largest international serviced residence owner-operators, his words can be taken seriously. After all, the group offers three brands – Ascott, Somerset and Citadines – in 56 cities in 22 countries.


Ascott became a global player only in 2001, when it got listed on the Singapore Exchange. Since then, it has expanded into a business with a total of 5,000 employees and 21,000 serviced apartments in 158 buildings in key cities across Asia-Pacific, Europe and the Gulf region. Revenues swelled from $232 million in 2002 to $435 million last year. Net profits jumped from $18 million in 2003 to $177 million in 2007.


The group moved into India in August 2006 when it inked a joint-venture (JV) agreement with the Rattha Group to acquire and develop seven serviced residences with a total of at least 1,000 units in the country by 2010. Total investment is estimated to be 10 billion rupees (S$320 million).


Ascott has already unveiled six residences with 1,398 units in Ahmedabad, Bangalore, Chennai and Hyderabad. ‘These are all currently under development – the first, a Somerset property, is expected to open in Chennai later this year,’ Mr Lee says.


Economic powerhouse


Ascott’s Indian partner is in the businesses of exports, infrastructure development and leasing. ‘Rattha has strong networks, deep local knowledge and sizeable land banks in strategic locations,’ Mr Lee says. ‘They complement Ascott’s expertise in managing and owning serviced residences.’


What drew Ascott to India? ‘There’s a lot going for India, one of the two economic powerhouses in Asia,’ he says. ‘Foreign direct investment (FDI) in the country is increasing and more multinational corporations are either setting up shop or expanding their presence there.’ At the same time, India’s gateway and second-tier cities are seeing more business travellers, resulting in a rising demand for quality accommodation for extended stay. ‘We are geared towards providing business travellers with home-like comfort, space and wide-ranging services that they will look out for and appreciate after a long day at work in a foreign country.’


Given the shortage of quality accommodation in India, he says there is much room for Ascott to expand. But while India is rolling out the welcome mat to foreign investors, Mr Lee says operating a business in the huge country still steeped in many of the old ways is a challenge. ‘Often, there are no proper or clear-cut processes,’ he says. ‘In a highly competitive environment, you either run with the locals, or sit and wait for the permits to be approved.’


The problem, Mr Lee says, is how to get the balance right in terms of time-to-market – getting the products out into the shops – while waiting for the regulatory clearance, which may take longer than expected.


‘It’s an adrenaline rush juggling both,’ Mr Lee says. ‘You have to be mindful of regulatory and legal restrictions while keeping a close watch on your competitor’s moves – and getting your product out into the market quickly.’


India‘s creaking infrastructure is also a pain for Ascott. But the group also sees opportunity in this drawback. ‘Being the first to go into certain cities in India, we play a part in helping to put the right and necessary infrastructure in place,’ Mr Lee says. ‘It may be frustrating at times, but if you look at it from another perspective, we are actually a pioneer or trailblazer of sorts.’


Looking ahead, Mr Lee sees a more exciting time for India’s hospitality and travel industry – and for Ascott, too.


Source: Business Times

Big players from the little red dot

Big players from the little red dot


DESPITE being small, Singapore boasts a sizeable pool of hoteliers and serviced residence owners and operators who have made their name in the world.


The Ascott Group, a hospitality player with a presence in India, is one of the world’s largest international serviced residence owner-operators.


Banyan Tree made the Conde Nast Traveller’s Gold List 2006 in the ‘Best for Rooms’ category. It also won a Travel & Leisure Award for being the world’s 33rd best hotel group and 11th best in Asia. Millennium Copthorne Hotel Group is among the world’s 40 biggest hotel groups.


Indian market


According to Reginald Wee, regional director for international operations in South Asia at International Enterprise Singapore, the 40-odd Singapore-based global hospitality enterprises operate 513 hotel and serviced residence properties with 89,554 keys outside Singapore, excluding Shangri-La.


‘The Indian market remains the most important in South Asia for Singapore-based hospitality players,’ Mr Wee says.


‘At the latest count, there are 10 Singapore players in South Asia, which by end-2010 will manage 34 properties with 3,656 rooms.’


They are Ascott, Banyan Tree Hotels and Resorts, Hotel Properties, ALiLA Resorts, Bonvest Holdings, COMO Hotels and Resorts, Pan Pacific Hotels and Resorts, Raffles, Aman Resorts and Millennium & Copthorne International.


Skilled worker shortage


Mr Wee says potential challenges in the hospitality business include a shortage of skilled workers, retaining quality workers and a lack of government incentives such as capital subsidies, tax holidays and low interest rates.


‘Retention of the workforce is a real problem, with high attrition levels,’ he says. ‘One of the reasons is comparatively unattractive wages compared with those in other sectors. So despite a boom in the services sector, many hotel management graduates choose to join other industries like retail and aviation instead of hospitality.’


Many governments do push for investment in the hospitality sector. Their backing is confined mainly to concessions such as stamp duty and electricity consumption, he adds.


Source: Business Times

4 Ascott projects opened this month

4 Ascott projects opened this month


THE Ascott Group said yesterday that it opened four new serviced residence projects – one each in Australia, Vietnam, Thailand and Qatar – in the first two weeks of June.


The properties are Somerset St Georges Terrace in Perth, Somerset Hoa Binh in Hanoi, Citadines Sukhumvit 8 in Bangkok, and Somerset West Bay in Doha.


The projects are on top of two properties Ascott opened earlier this year: Ascott Guangzhou and Somerset Emerald City, Suzhou.


Ascott president and chief executive officer Jennie Chua said the group has five other properties scheduled to open this year in Bangkok, Chennai and Singapore.


The new properties will consolidate Ascott’s position as the world’s largest international serviced residence owner-operator, she said.


Somerset St Georges Terrace in Perth has 84 units and is in the heart of the business district. It is within walking distance of many restaurants, cafes and boutiques, and is just one street away from the Perth Convention Exhibition Centre.


The 206-unit Somerset Hoa Binh, Hanoi is part of a mixed development comprising an office tower and a retail podium. The property is in Hoang Quoc Viet Street, Cau Giay District – a 10-minute drive from key commercial and civic districts. It is also close to the Hoa Lac high-technology development zone and Thang Long Industrial Park.


In Bangkok, the 130-unit Citadines Sukhumvit 8 is five minutes from the Nana Skytrain station.


The 200-unit Somerset West Bay project in Qatar is in the heart of Doha’s diplomatic area where ministry headquarters, embassies and consulates are located. The property is next to the Qatar Financial Centre and adjacent to the City Centre Shopping Mall, one of Qatar’s best-known shopping destinations.


Source: Business Times

Ascott opens four new apartments

Ascott opens four new apartments 


THE Ascott Group has opened four new serviced residences in four countries across three regions in the first two weeks of this month.


They are the Somerset St Georges in Perth; Somerset Hoa Binh in Hanoi; Citadines Sukhumvit 8 in Bangkok; and Somerset West Bay in Qatar.


This means i:t has now opened a total of six new properties this year, having earlier launched two in China. Five more are slated for completion :in Bangkok, Chennai and Singapore later this year.


Ms Jennie Chua, Ascott’s president, said: “The new properties will further consolidate Ascott’s position as the world’s largest international serviced residence owner-operator.”


Source: Today Newspaper